The Impact of Paid Parental Leave on Labor Supply and Employment Outcomes in Australia

The Impact of Paid Parental Leave on Labor Supply and Employment Outcomes in Australia

By Barbara Broadway, Guyonne Kalb, Duncan McVicar, and Bill Martin

HIGHLIGHTS

  • Studying the effects of introducing paid parental leave (PPL) in an advanced industrial country is important for the US, which is considering PPL.
  • PPL was introduced in Australia in 201 l. Previously only 57 percent of 20–45-year-old women had access to paid parental leave provided by employers.
  • Post-PPL, mothers initially return to work from leave more slowly than before, but after about six months of leave they return to work at a faster rate than pre-PPL.
  • Post-PPL, the probability of returning to work within a year is higher than pre-PPL.
  • PPL helps mothers balance paid work and family life and improves workplace attachment. Both effects are, on average, stronger among more disadvantaged groups.

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